Question

On June 3, Riverbed Company sold to Chester Company merchandise having a sale price of $5,600 with terms of 2/10,n/60,fo.b. shipping point. An invoice totaling $92, terms n/30, was received by Chester on June 8 from John Booth Transport Service for the freight cost. On June 12, the company received a check for the balance due from Chester Company. Prepare journal entries on the Riverbed Company books to record all the events noted above under each of the following bases. (1) Sales and receivables are entered at gross selline price (2) Sales and receivables are entered at net of cash discounts. (If no entry is required, select "No Entry for the account titles and enter for the amounts Credit account titles are automatically Indented when the amount is entered. Do not indent manually No. Date Account Titles and Explanation Debit Credit (1) June 3 Accounts Receivable 5600 Sales 5600 June 12 Cash Sales Discounts Accounts Receivable e Textbook and Media List of Accounts Prepare the journal entry under basis 2, assuming that Chester Company did not remit payment until July 29. (If no entry is required, select "No Entry for the account titles and enter for the amounts Credit account tities are automatically indented when the amount is entered. Do not Indent manually) Date Account Titles and Explanation Debit Credit July 29

Answer 1

Date		Account titles and explanation		Debit(in $)	Credit(in $)
1	Jun-03	Accounts Receivable		5,600
		Sales			5,600
	Jun-12	Cash		5,488
		Sales Discounts($5,600*2%)		112
		Accounts Receivable			5,600
2	Jun-03	Accounts Receivable($5,600*98%)		5,488
		Sales($5,600*98%)			5,488
	Jun-12	Cash		5,488
		Accounts Receivable			5,488
	Jul-29	Cash		5,600
		Accounts Receivable			5,488
		Sales Discounts Forfeited			112